Qantas Airways said to cancel order for one Boeing dreamliner

Qantas Airways Ltd. canceled one of the 15 orders it has for Boeing Co.'s 787 aircraft, according to a person familiar with the matter.Associated Press

Bloomberg News

Qantas Airways Ltd. canceled one of the 15 orders it has for Boeing Co.'s 787 aircraft, according to a person familiar with the matter.

The cancellation is the first since regulators in the U.S. and other nations grounded the Dreamliner after an emergency landing by one of the planes in Japan. Qantas's decision to scrap the order for its Jetstar unit isn't connected to the grounding and had been planned since late last year, the person said, declining to be identified as the information is private.

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Planes from the remaining 14 firm orders are due to start arriving from July, the person said. Qantas, which canceled 35 787-9s for its main unit in August, retained the 50 purchase options it has for the Dreamliner.

Boeing has kept Qantas "fully informed" about the 787's performance, Luke Enright, a spokesman at the Sydney-based carrier, said. He didn't comment on the cancellation. The airline is confident that the current issues will be resolved before Jetstar gets its first Dreamliner, he said in an e-mail.

"Qantas is a long-standing and very valued customer and we're committed to working with them on their evolving fleet needs," Allison Bone, a Sydney-based spokeswoman for Boeing, said by phone yesterday.

The Dreamliner, Boeing's most advanced jet ever, is facing its biggest crisis since entering commercial service in late 2011 as airlines ground the planes amid safety concerns caused by battery fires.

The Federal Aviation Administration ordered airlines to prove that lithium-ion batteries in the 787 "are safe and in compliance." The FAA's decision to ground the planes is the first such move involving an entire model in 34 years.

India, Chile

The European Aviation Safety Agency said it adopted the FAA directive. Regulators in Japan, India and Chile also ordered 787s in their countries grounded after an All Nippon Airways Co. plane made the emergency landing in Japan Jan. 16 following a battery-fault warning.

Boeing is set to double production of the 787 over the coming 12 months to help fill about 800 outstanding orders for the aircraft, making the year a crucial one for the fuel- efficient plane, which costs an average of $207 million at list prices.

Through the end of 2012, Boeing had 848 orders for the 787, according to the planemaker's website. There are now 50 planes in service, which have flown 50,000 hours, Boeing said.

Qantas scrapped its order for 35 Dreamliners in August after delivery delays and losses on international routes. The carrier said at that time it would get $433 million from Boeing, including more than $300 million compensation for the delays and a refund of deposits for the canceled order.

The carrier had brought forward by two years the 50 options for 787-9s so that deliveries would begin in 2016 if they are exercised.

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